The Pensions Regulator chief executive Bill Galvin says he will not push the Department for Work and Pensions to introduce legislation to improve take-up of the open market option.
In an interview in this week’s Money Marketing, Galvin says the issue is not a priority for the regulator in the short term.
He says: “I do not expect in the short term that we will be rushing to convince the DWP that we need any legislation in this area. I think there is a lot of goodwill in the defined-contribution area to try and get the open market option right and get it sor- ted for auto-enrolment. Down the line, there may be a need to legislate but the first thing to do is to try and settle on an idea of what people think is a good solution.”
TPR recently produced a DC paper looking at a number of regulatory issues including the Omo and would have to be heavily involved if new legislation was to be introduced.
Last year, pressure grew on pension providers to improve the process of shopping around after an ABI email to members said the Government had a “serious appetite” for wholesale reform.
In November, The Pensions Regulator and the DWP issued a joint statement urging providers and scheme trustees to improve communication of the Omo. This was followed in December with the threat of legislative action if the industry failed to establish how the Omo could be improved.
Worldwide Financial Planning IFA Nick McBreen says: “Individuals and providers in the industry have been trying to promote the Omo so that clients maximise their benefits. If the regulator’s brief is to reduce consumer detriment, then it should be part of that drive.”